President Joe Biden speaks to reporters after an infrastructure event in the South Court Auditorium of the White House complex in Washington, Wednesday, October 19, 2022.

EV battery spending craze snubs Michigan, favors ‘battery belt’

Washington— The US Department of Energy on Wednesday announced $2.8 billion in funding across 12 states for the production of electric vehicle batteries. None of the projects — most of which focus on battery ore processing or component manufacturing — are in Michigan, which remains the nation’s largest auto-producing state.

When asked why, DOE officials who spoke on condition of anonymity said the reason was twofold: there was a rush to invest in battery cell manufacturing after the adoption of the Inflation Reduction Act, which reduced the need for federal funding for this stage. .

And on the other hand, the agency wanted to select projects located close to the supply of raw materials or close to their customers. Michigan’s Upper Peninsula is home to the only nickel mine in the United States, one of the essential components of electric vehicle batteries.

President Joe Biden speaks to reporters after an infrastructure event in the South Court Auditorium of the White House complex in Washington, Wednesday, October 19, 2022.

But that doesn’t mean Michigan won’t benefit from the influx of cash: It’s targeting a part of the electric vehicle battery supply chain that’s particularly weak in the United States right now, experts say. and strengthening those ties will help Michigan-based businesses. as they pivot to electric vehicles.

There has been rapid growth in battery cell and battery assembly plants over the past three years, including in Michigan, said Sam Abuelsamid, principal research analyst at Guidehouse Insights.

“But you have to have all these other components to produce these cells,” he said. “We are now starting to see the rest of that national supply chain fill in, and that will help make the whole industry more resilient to future shocks.”

DOE officials said there would be multiple rounds of funding, and Michigan projects may receive funding in the future depending on “what part of the supply chain we’re solving for.” The $2.8 billion funding is the first round of battery investment from the bipartisan Infrastructure Act, which was signed into law last year. The law allocated more than $7 billion for critical electric vehicle battery materials and components.

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